Recent regulatory developments in the context of the EU sustainable finance agenda create an “urgent need for publicly available ESG data, as well as how to enhance their sourcing”, according to six European financial organisations.
A letter was sent to European Commission director general John Berrigan on 9 June by senior representatives from the:
- European Association of Cooperative Banks (EACB);
- European Banking Federation (EBF);
- European Fund and Asset Management Association (Efama);
- European Savings and Retail Banking Group (ESBG);
- Insurance Europe; and,
Quick, comparable, reliable
In it, the group professes its support for “the transition to a more sustainable economy and tackling climate change”.
But one issue it considers “particularly important” is the creation of a centralised electronic register for environmental, social and governance data in the EU.
“Unfortunately, the availability of quality, comparable, reliable and public ESG data is currently rather limited and insufficient to comply with the increasing expectations and new regulatory requirements due to apply shortly,” the group wrote.
This, they warned, could lead to “unnecessary costs and competition concerns”.
“Therefore, ensuring the availability of high quality and comparable ESG data should be regarded as an EU strategic infrastructure project to meet the EU sustainability objectives both under the Action Plan of Sustainable Finance and the EU Green Deal.”
The six signatories acknowledged that a common European Green Deal dataspace is “already envisioned”, but the group called on the EU to investigate how its proposed ESG data register “can fit into this context”.
What would it look like?
As a first building block, the register should focus on ESG disclosure in line with the non-financial reporting directive (NFRD), EU taxonomy-based information, “starting with climate change adaptation and mitigation objectives”, the group wrote.
It should also include “relevant ESG information already collected by European and national institutions, such as governments, central banks, statistical bodies, etc”.
As member states are “already reporting environmental expenditures”, the EU “should open up its databases that collect environmental reporting data and make those re-usable”.
The data should “be provided to users, ideally free of charge”, the letter outlined.
“The availability of raw harmonised ESG data would allow for better comparability, increase transparency, lower barriers and costs, generate efficiency, reduce complexity and attract new players,” the signatories stated.
The database would also help eliminate multiple requests to data preparers.
The letter was signed by:
- Hervé Guider, general manager of EACB;
- Wim Mijs, chief executive of EBF;
- Tanguy van de Werve, director general of Efama;
- Chris De Noose, managing director of ESBG;
- Michaela Koller, director general of Insurance Europe; and,
- Matti Leppälä, secretary general and chief executive of PensionsEurope.